Does Management Matter? Accenture–Stanford Field Experiment in Mumbai Textile Plants

Indian textile firms were known to underuse well-established Western and Japanese management practices despite operating in a competitive market, raising the puzzle of why competitive pressure had not already forced their adoption.
Researchers from Stanford's Graduate School of Business partnered with the global consulting firm Accenture, which provided consulting at roughly half its commercial rate to a randomly selected treatment group among 20 plants across 17 large textile firms, covering quality monitoring, inventory management and HR processes, while control plants received only a diagnostic report.
Within the first year, treated plants raised average productivity by about 11%, driven by fewer defects, lower inventory and higher output, and shifted toward more decentralized decision-making and greater computer use; within three years treated firms had opened more new production plants than control firms.
The study also found that poorly managed competitor firms were not rapidly driven out of the market by better-managed rivals, showing that competition alone had not solved the problem — which is why the deliberate consulting intervention was able to make a measurable difference.

Read the full analysis: https://www.gsb.stanford.edu/insights/research-economics-lessons-indian-textile-firms